Skip to main content

tv   Street Signs  CNBC  September 17, 2013 2:00pm-3:01pm EDT

2:00 pm
boeing on the list and announced a big expansion for the 787-10 that's going to take place and tjx companies on the list. that does it, right. >> that's right. and the dow and s&p less than a percent away from their all-time highs. that will do it for today's "power lunch." >> have a great afternoon. "street signs" begins now. all right. welcome everybody. a big show for you, 24 hours now until the federal reserve meeting but before we get to any of that is a live look in washington, d.c. we are awaiting a press conference from the fbi on yesterday's tragic naval yard shooting. we're going to bring it to you live. our colleague eamon javers in washington, d.c. where the facts have been collected over the last 24 hours. what do we know right now? >> hi, brian. we're waiting for this press conference expecting to hear a lot of new information and, of course, clear up some of the misinformation that's been out there over the past 24 hours. >> today i would like to announce the people who would be
2:01 pm
appearing here and also the order of speakers. consider this the two-minute warning. first we have our assistant director in charge of the fbi's washington field office valerie parlev, followed by chief cathy lanier and michael monroe. >> saying this is the two-minute warning so basically we're waiting for this to begin and listing off the names of the officials we're watching here. couple key questions we're going to be waiting for including why they put a lookout out yesterday for two individuals. remember a white male and black male that authorities said they were looking for. want to learn a little bit more about who those people were, why they thought they might have been involved here and the weaponry involved. there were initial reports from authorities that the shooter in this case used an ar-15 military-style weapon semiautomatic long gun. that apparently now is not true according to latest reports we've gotten. we want to hear about what it is
2:02 pm
the shooter used and how he got his weapon or weapons on to the base here at the washington navy yard. a lot of unanswered questions as we go into this press conference, waiting to see if we will get new answers. >> one of the biggest things we need answers for about the motivation. we've learned about alexis in terms of the fact he was hearing voices and treated for mental illness in the weeks leading up to this tragic event and yet the motivation seems a little unclear. >> right. exactly. we do know he was hearing voices. we know he was having sleep issues. we know he was having moments of paranoia and he was seeking treatment from the va, veterans administration. >> and yet -- >> since the summer -- >> eamon, waiting on the fbi, which they're walking to the podium. and yet this jeptsman was allowed security clearance. all right the fbi press conference beginning right now. let's list in. >> 24 hours after yesterday's
2:03 pm
shootings at the washington navy yard. we want to take a moment to provide information on the investigate-. i'm joined by chief lanier, michael monroe, special agent in charge of ncis, u.s. attorney ron manchin, chief chambers of the u.s. park police, carl vasellco of atf and ellerby of d.c. fire and ems. i would first like to commend and thank the agencies you see here with me today as well as many others. we continue to actively work together and the partnerships and cooperation among us are vital to the progress of this investigation. as briefed last night we believe at this time that the deceased shooter, aaron alexis, acted alone. as such with no other suspects at large, the investigation has moved into a phase of evidence recovery and information
2:04 pm
gathering. we have confirmed 13 fatalities to include the shooter, all of whom have been positively identified. our evidence response teams remain at the navy yard and continue to process the scenes. as i mentioned last night, this is a methodical and time-intensive process that includes bullet trajectory and crime scene mapping and with the assistance of our evidence response personnel from our baltimore and richmond field offices, we will remain there for as long as necessary to carefully process each shooting site. in regards to the weapons used by mr. alexis, there has been a lot of information circulating in the in the media over the past day. once again, we caution against obtaining information from unofficial sources and we ask that all inquiries be directed to the fbi. at this time, we believe that
2:05 pm
mr. alexis entered building 197 at the navy yard with a shotgun. we do not have any information at this time that he had an ar-15 in his possession. we also believe mr. alexis may have gained access to a handgun once inside the facility and after he began shooting. as previously mentioned, mr. alexis had legitimate access to the navy yard as a result of his work as a contractor and he utilized a valid pass to gain entry to the building. we also continue to conduct all other necessary investigation to learn about the activities and contacts of mr. alexis. we continue to conduct interviews, exploit digital media and run down every lead we can to piece together his recent movements and determine the motive behind his attack. we can say that we have
2:06 pm
determined mr. alexis arrived in the washington, d.c., area, on or about august 25th. and he has stayed at local hotels in the area since that time. most recently, he is known to have stayed at a residence inn in southwest washington, d.c., starting on september 7th. we ask anyone who may have had contact with him during this time or previously, to contact the fbi with that information. as a result of the public's cooperation thus far, we have received hundreds of tips which we will continue to follow up. the investigation -- this investigative activity is not only taking place here in washington, d.c., but in various cities across the country where mr. alexis has spent time. we are greatly appreciative of the public's cooperation and we, again, ask anyone who may have knowledge of mr. alexis to report that information to the
2:07 pm
fbi. no piece of information is too small. we also continue to put forth other fbi assets towards this investigation. our office of victim assistance is working together with mpd and the department of defense to provide resources and support to victims and next of kin. we also have personnel from our behavioral analysis unit, assisting in the investigation, as we ri to determine the motivation behind the shootings. we continue to look into mr. alexis' past including his medical and criminal histories. because that part of the investigation is still ongoing, we will not comment further on that at this time. once again, i would like to thank our partner agencies and all those who have participated in yesterday's response. i'd also like to thank all of the individuals who work at the navy yard for their cooperation
2:08 pm
and patience during a long and trying day. i want to extend my thanks to the public for their continued support. please continue to report any and all information regarding mr. alexis by calling 1-800-call-fbi. that is 1-800-225-5324. thank you and i would like to now invite chief lanier to say a few words. >> i have very little to add from what our last briefing was last night. i will try and answer the questions that i've been getting from most of the press. first and foremost, our officer is doing well. i visited with him last night. he is in good spirits. he is pretty uncomfortable. he has some pretty serious injuries, but we do expect he will make a full recovery and he extended multiple times his thanks for the support from the public and also his gratitude
2:09 pm
for the other law enforcement officers who responded who helped to get him out of the building and get him to safety after he was injured. so again, that would not have happened in every case, but the working relationship with mpd and all of our partners here in the region and the training we do was critical yesterday. also, i'll say we have gone and looked further in a similar response and spent several hours this morning and as proud as i was yesterday of the working relationship, the teamwork, and the heroism of the police officers and first responders, i'm even more so today. i have seen things that we have trained for and planned for for years, come into place nearly flawlessly. literally two minutes after the call was dispatched, we had officers at the gates arriving on the scene. within seven minutes, had officers at the building
2:10 pm
entering the building to engage in active shooter as shots were actively being fired. we had officers who heroically went into a building -- >> we've been listening to a live news conference from the fbi in washington. eamon javers, of course, some things we have already known on this case. some things have come to light and certainly trying to solicit the public for more information on this and say they're still out there searching for motive. no amount of information is too small here. what is amazing is the reiteration, this is a guy, aaron alexis who had legitimate access to the navy yard. he walked in with a valid pass and had a shot gun. >> that's the central question in all of this, how was that allowed to happen. of course, mandy, not a whole lot of answers here from the fbi or the local police to some of the questions we've been asking. they did clear up the bit of misinformation that was out there yesterday about the ar-15 and said evidence response teams are on the site here at the washington navy yard and that
2:11 pm
may explain a very large mobile unit we saw being pulled in to this facility a few minutes ago. clearly they're bringing in more assets to help with the investigation. even as we speak. we also saw this morning here, them bringing out on a tow truck a blue prius vehicle that had fingerprint dust on it, some kind of damage to it, not totally sure what that was all about but clearly they're analyzing that vehicle and trying to figure out whether it played any role in this. they're going very deep into the evidence right now but they're not providing a lot of answers. and it seems like that sort of changed yesterday right after the d.c. police handed this investigation over to the fbi, we saw a real clamp down on information. we haven't had a lot of new information since that transition, guys, and this press conference continued the pattern there. >> man with a history of gun violence, michele caruso cabrera, treated by the va for mental illness and he received as the fbi said, quote, legitimate access to one of the most secure facilities in the united states. how does that happen? >> this is unfortunately a
2:12 pm
lesson we have already learned and we need to keep relearning. better prescreening. we learned this already from who, the post office. from 1986 to 199, many recall there was a slew of homicides, mass killings, where 48 postal employees were killed by 15 different postal employees. when they looked at the history of all the people back in 1986 to 1999 they found the vast majority had troubled histories like this man. they had substance abuse or had a history of violence or they had done other things that would have prevented them from being hired. five of those 15 people should never been hired based on their history. so what did the postal service learn? much better prescreening. why don't we know that now? the other lesson zero tolerance of any suggestion of violence and that may sound like duh, they found there was inconsistent responses from managers when an employee acted out. so no, this is not tolerable
2:13 pm
and -- >> bottom line, background checks. >> thank you so much for jumping in. thank you. >> all right. on deck, t minus 24 hours from what may be the most important fed decision in years. we've said that for years but mean it this time. your taper, no taper strategy session. >> microsoft announcing a mega stock buyback. is it as cramer says a sign of desperation or reason to be bullish. stick around. ♪ (train horn) vo: wherever our trains go, the economy comes to life. norfolk southern. one line, infinite possibilities.
2:14 pm
with fidelity's options platform, we've completely integrated every step of the process, making it easier to try filters and strategies... to get a list of equity options... evaluate them with our p&l calculator... and execute faster with our more intuitive trade ticket. i'm greg stevens, and i helped create fidelity's options platform. it's one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.
2:15 pm
2:16 pm
this is indy the final countdown to what is expected to be the most important fed day to the just this year, but in years. when will the fed start tapering its $85 billion bond buying program and by how much? "street signs" is your all things fed headquarters and this is your mission should you choose to accept it. to know how to position your portfolio no matter what we hear or do not hear tomorrow. send it over to brian for a trip down qe memory lane. >> that's right. we're taking a look at the s&p and ten-year yield since kwan tative easing one began about five years ago. that is in blue. the ten-year yield in yellow. the point, qe1 began november 25th, they announced it before that, the first kick in here. since then qe2, qe3. the blue line, the s&p 500, 94%
2:17 pm
gain in the s&p 500 since kwan tative easing 1 began. see that ten-year yields until recently had been going down. a few blips and moves here but overall down until the final in there. now the question is going to be, and this is the question for stock investors, if we're up 94% on the s&p, since quantitative easing one began, when they -- not if, because they will pull off some point, when they pull back on quantitative easing how much, if at all, will the dow goes down? it's a trillion dollar question. just to leave you with cocktail party stats even though it's a tuesday night, it's friday somewhere. that's not true but you get the point. we have been soaring. this is the eighth best start to the year since all the way back in 1928 and of the 14 times we've gone up more than 19% to start the year, only four of those times have we fallen in the fourth quarter. >> guess what, 5:00 p.m. friday every day in australia but get to steve liesman with the results of the exclusive -- you got the joke, right?
2:18 pm
the exclusive cnbc fed survey. >> they say don't schedule a meeting on wednesday in australia because you ruin two weekends. >> exactly right. >> i brought a lot of money here. i can ta say taper all i want. 20 bucks for you. here we go. >> give the results of your exclusive -- >> tale of the taper. i want to show you, up the average -- walk in front of my camera there. brian. >> i dmoents where to go. >> $14.5 billion the average. up from when we polled after the weak september, august employment report. so you know, 53% of our respondents say it will be $10 billion. that's where the majority is. so you know that's the average if you count everybody. 48% think the taper begins in september. announced tomorrow. the fed maintaining that level for about 3.5 months and end in 2014 in august. now, there's an interesting split between the market and fed when it comes to the outlook for interest rates. i want to show you this.
2:19 pm
you can see on the leaf is the average of -- left is the average of fed participants and what they say the feds fund rate will be, and the survey of our respondings. another quarter point in the blue, and the green in 2015 it's more. here's what i did. i took out the hawks from the fed and watch what happens. so the market is not really following the hawks here. the market is basically throwing out those fed members that have these very high fed funds forecasts for outlying years and then the fed and market are no longer at odds. one thing that is now in play that hadn't been before, will the fed change the rate guidance? remember we talked about 6.5% as the threshold for beginning to think about raising rates. you can see compared to our july survey, markets warming to it a little bit. up to 44% saying yes, not a majority yet, but there is some thinking that maybe with the taper, being -- >> there's one. >> comes potentially -- >> that's about ten, brian.
2:20 pm
>> comes potentially a change in the rate. how will they do it? two different ideas in the market right now. one is that it goes to 6% from 6.5%. that's 49%. another group are those come off a little bit think they get rid of the threshold altogether. that's where we are. some expectation a tinkering around the edges about threshold but pretty positive expectation for a threshold. >> okay. >> for a taper tomorrow. >> all right. i got 17 bucks and change. >> only three? >> $17 and change. you said it three types from the taper jar. here's your change. >> does the mauney go to charity? >> taper taper taper "street signs" happy hour charity. >> thank you. >> get your playbook with two smart fellows, sheaf and chiefs u.s. economist at deutsch bank. to you first, because you're on set here, heard steve's report, excellent data there. here's the question, how much, if at all, is the reduction? bond buying, because i'm not throwing another buck in there,
2:21 pm
already built into the stock market and bond market if at all? >> i think somewhere close to 15 is built into it. i won't use the "t" word either. i don't want to lose more of my money. i've already lost a lot with the qe and the process, brian. >> zing. >> so i'm going to say that 15 is probably what it is going to be. i agree with steve that way in which the forward guidance is given is probably going to be even more critical in terms of what the thresh hold is going to be. but i would put a thousand dollars into your jar, not one or five or ten, if they cancel qe altogether admit it was a big problem and allow the fundamentals to come into play. >> cancel qe altogether? >> i don't -- >> one fail swoop, they're not going to do that. >> they're not going to do that. that's why my thousand dollars is safe with me. >> i was speaking on futures with jeff kill berg, and he was saying he thinks there's the possibility, a bit counterintuitive, but maybe they might go more aggressive with the reduction, maybe $20
2:22 pm
billion, because now summers is out of the position, someone like a dove like yellen, maybe they want to counter akts that dove, what do you think? >> if the fed were to go larger, 20 or 25, then the chance that they change the fleshhold or loose threshold of unemployment is higher. if they pushed out the timing of the tightening and did that by lowering the unemployment threshold yes, i can see a larger taper. otherwise, mandy i don't -- >> what would you be happy to see? >> i would -- i agree with kacle mall, if they stopped qe. it's created a lot of different bubbles. this fed is dovish, continue to be dovish, they will make the point in the press conference, the chairman that the fed will keep rates accommodative for an extended period, even when qe is done, so unfortunately we're stuck with this accommodative policy for as far as the eye can see. >> mandy, i think the qe has become a no-win situation now. if it is going to be a case of
2:23 pm
20 as joe mentioned, then the market takes fright from the fact that the cutback in bond purchase, still avoided the word, is much created than expected. that's a fif for the equity market. as i've been saying on your show, i think the equity market depends on the quantitative easing a big one will be a shocker. too small a one, you only are increasing the distortions for the future -- >> don't we need to change our language. isn't it amazing guys and gal that we're talking about a reduction of $20 billion as a, quote, big deal. do you realize that's less than two days of federal government spending. less than two days of federal government spending. it's $20 billion. >> but the matters because if you are going to lower it by 10 or 15 or 20, you expect it's going to come to an end like an interest rate increase is no the a single one. a cutback is no the a single cut back either. >> all about expectations how the market games out. the future amount that the fed will have and really it's also
2:24 pm
about when they feel like this kind of policy right now, what clues it gives about future interest rate policy. that's the thing the fed cares about. one of the things very quickly something we will be talking about this time tomorrow which is the mix. joe, we had a full screen with joe's mix on. he looks for $5 billion in mortgages and i think it was $10 billion in treasuries. our survey shows the market expects about 72% of the taper to be in treasuries. now the guys on fast money saying they were going to freak out if any was mortgages. the fed is going to pay attention to that. >> and the 16 -- >> last word. >> when steve talked about the dots or forecasts, conceivably the governors, seven of them, would have forecasts for 16 that aren't as low as were maybe people in the market think it's likely to be and that's the way they do the forward guidance. isn't in words but if their fed forecast. >> instagrams. >> that's a huge deal. 2016 first projections, first look tomorrow and a reason to watch. >> let's throw this reminder in,
2:25 pm
a good time to show you actually "street signs" will be your place to turn to for the fed decision. the moment it happens in less than 24 hours, we're going to have a powerhouse panel, we have live coverage, carrying chairman ben bernanke's news conference afternoon afterwards and steve liesman. >> i'm bringing you the news. >> bringing us the news. >> i will bring you the statement tomorrow. >> key question, chinatown bust or a sell on the way down? what are you driving to d.c.? >> i fly. i fly. >> okay. >> high roller. >> herb on herbal life stocks surge plus a $4 billion money manager will here with a trio of here to there stock picks. >> first, can you guess today's mystery chart? it's a tech company. one of the best performers the s&p mid-cap this month based in maryland and was founded in 1992. mandy's year of birth.
2:26 pm
tweet us your guesse guesses @streetsignscnbc. that's a compliment. back after this. but when it comes to investing, i just think it's better to work with someone. someone you feel you can really partner with. unfortunately, i've found that some brokerage firms don't always encourage that kind of relationship. that's why i stopped working at the old brokerage, and started working for charles schwab. avo: what kind of financial consultant are you looking for? talk to us today. nascar is ab.out excitement but tracking all the action and hearing everything from our marketing partners, the media and millions of fans on social media can be a challenge. that's why we partnered with hp to build the new nascar fan and media engagement center. hp's technology helps us turn millions of tweets, posts and stories into real-time business insights that help nascar win with our fans.
2:27 pm
2:28 pm
2:29 pm
30%. it is siena. we brought it to you because i couldn't believe it. i ran the screen this is a name we haven't heard about forever. cina, networking and software company, by the way, fertilizers rocking it, the number one performer this month in the mid kap 400. >> speaking of top performers our next guest has stocks on the move, literally. these high-flying stocks, gm, hertz and delta are outpacing the markets this year. do they have more room to run. ask patrick, the portfolio manager of brandywine global. why do we get first of all to what is happening with delta. it was actually an upgrade put out by jp and just today good timing saying delta will have increasing margins since it's one of your picks you agree. >> yeah. absolutely. talk about great timing. i love coming on when things have been upgraded. look at that chart and see delta up 96%. is this done? we think not. delta and the airlines in general we think are the cheapest stocks in the market
2:30 pm
right now. let me tell you what's changed in the airline industry because a lot of people believe that things haven't changed. gone from 10 major airlines to really four. management for the first time in the history of the industry are acting irrationally and cutting capacity. delta will earn $3 a share, stock at 23 or so, less than eight times earnings, still another 50% upside potentially here, generates a lot of cash, initiated dividends, starting a buyback. i'm not saying this is a great environment for flyers because people are more on the airlines, paying for bags, everything, involving airlines but it's great for the companies. >> although i love -- >> even though it has moved a lot. >> as a frequent traveler i love your next pick. with the rental car consolidation the name is correct every time i pay the hertz. >> yes. >> the costs have gone out of control. >> it's another industry you've had consolidation, a lot of players, down to avis,
2:31 pm
enterprise and hertz. one of the things that has changed in the management of the company that we don't see necessarily as a customer but going on behind the scenes, is they used to return cars to the car manufacturers, used to sell them at auction now hertz one of the things they're doing to make more money is they have taking that car after used for a year, year and a half, selling it directly like we see enterprise, hertz is opening up used car lots. make about $1,000 more car. lot more profit. that's another one we see earnings growth in the coming years and really a cheap stock when we look at future earnings. >> and the last one is another name that's in the news today and that is gm which is your favorite pick out of the auto sector. >> yeah. you know, there's really a theme here. we've got cars, we've got rental cars, airlines, it's a bullish view of the american economy that we have on our team at brandy wynn. gm, a couple things going on here. this is not the old gm. quality is better, balance sheet better, lot of the issues were
2:32 pm
taken care of in bankruptcy financially. this k 2 pick-up launch going on that's higher margin cars, fewer incentives, regaining market share. the average car on the road right now is meaningfully older than 10 or 15 years ago. people need to replace cars and so gm is a kind of stock we think they can earn more than $5 next year. again another one of these we still see meaningful upside even though the stock is up already. >> and wants to go head to head with tesla with a cheaper electric car. thank you very much, patrick. >> cue up the christmas music because there are fewer than 100 days left until christmas and already looking like christmas is really going to just absolutely stink for a number of retailers. why we say that. >> later on the double chin stock surge and robert frank will take us inside america's downtown abby.
2:33 pm
2:34 pm
2:35 pm
2:36 pm
it is our favorite stock of the day and it is kythera getting a nice boost after successful trials of a double chin reduction drug. >> exercise? >> anyway, it held a conference call announcing positive top line results for atx 101 injectable treatment used to eliminate double chins without surgery. that is up about 160% over the last year alone sitting there at 41.80. >> in larger stock news today, microsoft announcing a huge stock buyback. company will be rerchg $40 billion worth of shares and boost its dividend by 22%. the buyback replaces the old $40 billion buyback. still, stock kind of oddly not doing too much right now. it's up about a half percent, nice pop at the open, kind of dropped after that and flat all day. find out what's going on, bring in yun. what do you think is happening here? why has there been a brief couple day, you know, exuberance over ballmer leaving and then
2:37 pm
fell, the buyback pop and drop, what's wrong with microsoft? >> first of all, the share buyback plan and dividend increase is largely expected by investors. it's simply a reset of what they had before, $40 billion reauthorization and dividend increase consistent with prior years. nothing really new here that's any investors would be excited about because of the recent involvement. so all in all it's more or less what people are expecting. the fundamental issue with microsoft is not steve ballmer leaving but the fundamentals of the business has to show improvement in the consumer market. >> it's interesting, because this morning our own jim cramer was saying it kind of smacks of desperation, a dividend high may be a desperate move by a company that does not need to be desperate. what do you think about that? sh shoe. >> sure. again in my view the stock is driven ultimately by fundamentals and some of these stock dividend increases or
2:38 pm
accelerated share purchase plans which they have not executed this morning is really a short-term fix. the long term and way to fix this company, is really to gain traction to the consumer market through better traction in the smartphone and tablet market to offset the declining pakiste ii business. >> the new tablet september 23rd. the new surface, do we care? >> so the number one issue in my view with the surface product is the pricing. it is fairly competitive product from a feature function point of view but it is still priced a little too high for a regular consumer. the hottest growth market in the tablet market is the low end and their pricing, if you compare it to the -- what amazon has to offer and what other oem has to offer it's too high. the way they can try to leverage and make better traction in the consumer market to leverage what they have with xbox 1 release for the holiday shopping. in my view they can leverage that xbox success top tap into the tablet market and smartphone
2:39 pm
market. the holy grail in the consumer market is to provide a one integrated entertainment experience across all devices any time and microsoft has all the footprints into delivering that. they have to put it together and they haven't been able to show that yet. >> you never ever have to leave your couch. yun, thank you very much for joining us. target there of 34 bucks. >> all right. up next e an incredible stat on how much money saudi arabia is making from oil. >> which retailers will be on the naughty and the nice list this holiday season? all those things and more, plus let's get bill griffeth what's coming up on the closing bell? >> general motors taking on tesla by developing its own long range electric car. we'll look at the charts and figure out which stock is the better bet to go the distance on that, xwm or tesla. we hear from somebody who says president obama may yet not pick janet yellen to succeed fed chairman bernanke, just to spite a senator in his own party.
2:40 pm
and famed investor byron wooen tells us where he's putting his money to work ahead of a possible fed tapering. and that and more, maria and i look forward to seeing you at the top of the hour on "closing bell." are designed to draw crowds.s others are designed to leave them behind. ♪ the all-new 2014 lexus is. it's your move. thank you orville and wilbur... ...amelia... neil and buzz:
2:41 pm
for teaching us that you can't create the future... by clinging to the past. and with that: you're history. instead of looking behind... delta is looking beyond. 80 thousand of us investing billions... in everything from the best experiences below... to the finest comforts above. we're not simply saluting history... we're making it. ♪ [ male announcer ] 1.21 gigawatts. today, that's easy. ge is revolutionizing power. supercharging turbines with advanced hardware and innovative software. using data predictively to help power entire cities. so the turbines of today... will power us all... into the future. ♪
2:42 pm
you really love, what would you do?" ♪ [ woman ] i'd be a writer. [ man ] i'd be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] i'd be an architect. what if i told you someone could pay you and what if that person were you? ♪ when you think about it, isn't that what retirement should be, paying ourselves to do what we love? ♪
2:43 pm
this is going to blow your mind. saudi arabia has a lot of oil but exporting at a record pace to make up for the slowdowns in the other middle eastern oil nations. get this, saudi arabia, according to the "financial times," the iae is making $1 billion per day. $1 billion a day. exporting oil. >> that would be nice. let's take a look at herbal life jumping more than 3% today. on comments that it could launch a big stock buyback soon. the analyst who made that call is joining us now, da davidson's team and herb green burg on the cnbc news line. tim, to you first of all, it was in your ♪ august 13th. how soon are we talking for you to believe this to happen? >> it's hard to say exactly, mandy. you know, we think that they're going to wait until they get their audit opinion back. we think that they're going to go with investment grade debt. and issue debt to do a
2:44 pm
significant share of purchase. so, you know, no one knows exactly what the timeline of that is except price waterhouse coopers. it sort of sounds like it's going to be soon. >> what about you, herb, do you think if, indeed, this is true it makes sense? >> well, this price it's unclear whether it would make sense when you look where the price is why wouldn't they have done this at a lower price? not just because of the auditor issue, you reach a point where you say look at the stock and what underwriter would take it at this level? further more, there's still one other issue and something that based on various reports i think, tim, you may have said today, and that is if they do this stock buyback, it would, you know, rest the bearish case once and for all. i have to tell you with all due respect and i do mean all due respect, the bearish case on this is not -- it's based on not that they're going to do a
2:45 pm
buyback, not that stock is going to go to the moon, it's based on an underlying issue, a business model issue, that is in gray area or appears to be in a gray area, some people believe is in a black area. you have to factor that in as well. >> tim? >> sure. well, you know, as we've said, if you're gray on that, give your d.a. davidson sales representative a call. we'll spend an hour with you and help you understand why this is not an illegal -- >> how do you know? >> people have -- >> how do you know specifically? that's the question. how do you or anyone know until the fda, until the ftc comes in and does an economic analysis? that's what i have been asking this whole time. no one can say with certainty until that analysis is done and made public. >> well, of course there is no certainty in the world. we don't even know that you exist, herb, but what we could know -- >> i can tell you, i definitely exist, tim.
2:46 pm
>> okay. well then i can tell you that this is not an illegal pyramid scene. >> how can you say that? how do you know that how do you know that. >> guys, tim and herb, let me -- we can sit here and debate for hours the structure of herbal life. let's do this. i want to ask you, given all the concerns raised by bill ackman's 52 page letter which you read, i read it, it was a hard read, it seemed to me very well received, very detailed, i know you address it in your latest note, give your beliefs, given bill ackman's beliefs, whatever it is, what's a compelling reason to actually own herbal life stock, given that there are some pretty smart people on the other side that believe the company is whatever it may be, is the upside worth that much to take that kind of risk? >> well, i read the 52 pages and at first the very first page says, you know, price waterhouse coopers you're in trouble if this is an illegal pyramid
2:47 pm
scheme. the other pages didn't address that at all. they were arguing about details and structure and accounting and so on. most of it was the kind of stuff that a couple of high-level cpas would have a lovely spirited discussion at a cocktail party over it should be done this way, no that way, not material to the yuts come of the company. there are some things where it was laughbly wrong. point of fact did not understand the case and, you know, that's a problem when you never call the company. they've never called the company. they've never really done good research on this. >> okay. we've got to leave it there. thank you very much for joining us with your side of the argument, tim. this is the stock up over 120% year to date. herb, thank you. unlike unicorns we do know you exist. >> still ahead, you might think we're crazy for showing you a countdown clock to, well, christmas. but retailers will thank us. we'll explain why coming up next. i love having a free checked bag
2:48 pm
with my united mileageplus explorer card. i've saved $75 in checked bag fees. [ delavane ] priority boarding is really important to us. you can just get on the plane and relax. [ julian ] having a card that doesn't charge you foreign transaction fees saves me a ton of money. [ delavane ] we can go to any country and spend money the way we would in the u.s. when i spend money on this card, i can see brazil in my future. [ anthony ] i use the explorer card to earn miles in order to go visit my family, which means a lot to me. ♪ mayo? corn dogs? you are so outta here! aah! [ female announcer ] the complete balanced nutrition of great-tasting ensure. 24 vitamins and minerals, antioxidants, and 9 grams of protein. [ bottle ] ensure®. nutrition in charge™.
2:49 pm
2:50 pm
♪ you're a mean one >> i know what you're saying, we're crazy pulling out the christmas countdown clock already.
2:51 pm
but if you have been paying attention, retailers are already getting into the full holiday swing. courtney reagan is here. i'm seeing christmas decorates all over the place. >> it seems to be happening earlier ander. this reason hanukkah starts a little earlier and the time between thanksgiving and christmas is six days shorter. holiday forecast, they believe brick and mortar sales will increase this year. they think online e-commerce is helping people do a little rese search before they get into the store so it's helping them narrow down what they want and not want and prevent shoppers from going store to store. 2.4% increase isn't all that bad. >> i would give that gdp growth right there. that said, guys, which retail stock will do the best if, indeed, the numbers are right
2:52 pm
and it's not a great christmas season. let's welcome in our newest cnbc contributor, jan rogers. now we can really abuse you. who do you think is going to hurt? >> first of all, i don't think -- i think courtney is wrong. it's not going to be 2.4%. that would be the worst year since 2009. i also think shopper track tends to undershoot because they don't count count online. >> but 90% of shopping is done in brick and mortar. >> online is so small compared to -- >> who is going to online and bricks and mortar really well this season? >> we have to say if it's that bad of christmas, it will be a promotional christmas. we'll see tgx and ross do better. i like ross better than tjx
2:53 pm
myself. that will be part of what people go for, right price. on top of price you'll want people who are really good at the internet. walmart is getting much better online. they started early, just like k-mart, with layaway. pushing very hard. they're already set up for christmas. they have the best in-stock positions they have. they're going to be a winner at christmas. the other big player will be macy's. they're the best omni channel out there. they'll do -- >> what does that mean, omni channel? >> means you can buy it online, on your mobile, any way you want to buy it and we'll get it to your house. we'll use 500 stores as our distribution centers to get it out to you. two years ago they had 20-plus stores. they used them as distribution centers to send stuff out as well as show rooms. last year 200 plus. this year 500 stores. they're right next to you, they can get it to you fast. put more inventory in the stories because they don't have to sell it out of the store. they can sell it online. they'll be a win gleer let's
2:54 pm
back up for a second and focus on walmart. you said they are the best in breed to be able to capture the shopper in store and online yet the share price has been underperforming this year. it's only up 10% year to date. only up 1% over the past 12 months. why? >> because their customer has been really strapped. their customer makes 30 grand a year. that 2% increase really matters to them. so, they're going to have an uphill battle. they've got to fight through that. but as that category goes, that's where you really care about price and you want to get it online and get it shipped from the store, walmart's doing that really well. >> p.s. -- courtney, i'm going to put you on the spot here, and it's impossible, so don't forget. second best performing retail stock this year, right, just below sears holdings, do you know what it is? >> jcpenney. >> five below. fiv ticker.
2:55 pm
52% stock gain this year. do we have any idea why? are they stealing people from walmart or a special situation? >> there's only 275 of those stores and they're small, so they're not stealing much from walmart but doing a good job. if you have a 9-year-old girl that needs a rainbow bracelet, which is what everybody needs, they've got it. >> headphones, five bucks. they've got it. >> what makes me nervous about five below is when you're a $500 billion sales company and $206 billion market cap company and forward multiple is 100, that's a problem. >> that is a problem. courtney, thank you. jan, your contributor, you'll be omni present on this channel. coming up, a big mansion boom in america's smallest state. (vo) you are a business pro. maestro of project management. baron of the build-out. you need a permit... to be this awesome. and from national.
2:56 pm
because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. (aaron) purrrfect. (vo) meee-ow, business pro. meee-ow. go national. go like a pro. seasonal... doesn't begin to describe it. running a bike shop has it's ups and downs. my cashflow can literally change with the weather. anything that gives me some breathing room makes a big difference. the plum card from american express gives your business flexibility. get 1.5% discount for paying early, or up to 60 days to pay without interest, or both each month. i'm nelson gutierrez and i'm a member of the smarter money. this is what membership is. this is what membership does.
2:57 pm
2:58 pm
newport, rhode island, is currently seeing a huge mansion boom. >> you know, cory krauly's mother living in new port. for years newport lagged behind hamptons. new money went elsewhere. but now it's regaining its shine. this house just sold for $14 million, called wild acre, built in 1902 and built by one of the heirs of the campbell's soup fortune. the most expensive was sold for
2:59 pm
$17 million in 2006. what make this is property so cool is the land and history. it's 180,000 square house, classic gables and peaks and 2.5 acres overlooking the atlantic. also has a private dock, terraces, infinity pool, greenhouses, guest houses. up more than 50% from the peak. newport, which is kind of like old school, old money, now some of the new money saying, hey, for my money, i can get a lot of house and some great seaside views compared to the hamptons. >> we're talking new money, what kind of person is going to buy something like that? >> larry ellison bought a different house for around $10 million. he's ficking it up as a museum to put his artwork in. tech guys, wall street guys, financier guys. >> i'm disappointed you didn't do that in an english accent. >> i'm disappointed lady cybill
3:00 pm
died. she was the bomb. >> a reminder, "street signs" is your place to turn to for the fed decision the moment it happens. in 23 hours' from now we'll carry ben bernanke's news conference. >> and would he ge get a look a6 projectio projections. big show. "closing bell" right now. hi, everybody, into the final stretch. welcome to "closing bell." i'm maria bartiromo at new york stock exchange. investors are worried about fed taking away the punch bowl -- >> do you think they're worried? >> no, i don't think so. i don't think we'll see tapering tomorrow. you and i agree on that. >> i don't think we would expect it given what the fed said they were going to wait for, but they haven't gotten that yet. >> they are expecting something. i think it's the credibility of the fed. yb


info Stream Only

Uploaded by TV Archive on